It's a mystery that we cannot really boil down to absolute facts. The conciliar church isn't exactly the True Church, but it's not completely separate either.
As +ABL said, the modernists and conciliar church occupy the True Church. No one is required to believe this here, but some of us do. In this situation, we have to assume that the True Church is still in Rome, but currently occupied. But what does occupation mean?
Although I believe it can be done, I don't believe we lay people are meant to boil it *all* down to absolute facts.
It should be enough for us to know that the conciliar religion is not only not Catholic, it is anti-Catholic, this cannot be denied. Knowing this, is knowing that we should avoid everything that has anything to do with it. The reason so many choose to disbelieve that which they cannot deny, is due to their lack of conviction as a result of a lack of faith.
+ABL was right, the modernists and conciliar church do occupy the True Church, Fr. Wathen puts it like this:
"...the Conciliar Church is not the Catholic Church, though it is within it, like a fifth column. Hence, no one who
maintains membership within it can be saved..." What is a "fifth column?"
Wiki puts it like this:
"A fifth column is any group of people who undermine a larger group from within, usually in favor of an enemy group or nation. The activities of a fifth column can be overt or clandestine. Forces gathered in secret can mobilize openly to assist an external attack." - describes the situation accurately imo.